This isn’t the first time we’ve sung the benefits of making sure your bookkeeping is done regularly and that your bank is reconciled regularly. This time we have a real life example of how it can help you to catch and stop fraud.

When you have the bank and credit card statements connected to Xero with a live feed, your bookkeeper can see the bank and credit card transactions in Xero. These then need to be matched to your bank payments or credit card statement.

If you are in a good discipline of recording bills in Xero and making payments based on the bills in Xero, then there shouldn’t be payments out of your bank that you don’t know about.

(Incidentally if you don’t have good systems in place and don’t have that sort of discipline about making supplier bills payments then let’s have a chat about how we can help you save time and improve controls by putting a good system in place.)

I promised a real life example and not just theory, so here’s what happened.

When reconciling the credit card statement some payments were present on the statement but the supplier bills weren’t in Xero. This was unusual as this client was usually good about making sure that supplier bills were sent through on time for processing. Some enquiries were made with colleagues to see if anyone knew what the payments were for or if they were old recurring payments which hadn’t been cancelled. No one knew anything. After contacting the bank it was discovered that the transactions were fraudulent. The bank cancelled the card and refunded the transactions.

But here’s the moral of the tale: if the credit card statement hadn’t been being reconciled regularly, not only would these transactions and this fraud have gone unnoticed for months, there would have also been further opportunity for the fraudster to spend even more money on the credit card, all unnoticed.

So if you are in the guilty habit of leaving your bookkeeping until the end of the year, if you are someone who keeps putting it off to be done another day, then get in touch and let’s get it fixed. We can take the stress away from you and maintain your books each month so that you have the peace of mind that comes from knowing that everything is accurate and up to date and that there aren’t any nasty surprises waiting for you at the end of the year.